PSEI extends slump as investors search for leads

LOCAL SHARES declined for a third straight session as investors remained on the sidelines amid the lack of major catalysts at home.

The Philippine Stock Exchange index (PSEI) erased 28.31 points or 0.39% to end Tuesday trading at 7,215.09.

The broader all-shares index also shed 0.77 point or 0.01% to settle at 4,271.42.

“We went contrary to other markets. Despite the US closing higher, with the Dow Jones [Industrial Average] up by more than 106 points, there was a sell-off due to the lack of any market-moving activity locally,” Luis A. Limlingan, business development head at Regina Capital Development Corp., said in a telephone interview after trading hours.

“For today, it’s just a technical correction since our market has already rallied about 20% since the low seen in January,” Lexter L. Azurin, head of research at Unicapital Securities, Inc., said in a separate phone interview on Tuesday.

“Valuations are already at roughly above historical averages, so in a way, the market took a breather for now,” he added.

Four out of six domestic subindices were in the red at the closing bell, with property leading losers after dropping 17.27 points or 0.58% to 2,935.67.

Holding firms declined by 32.49 points or 0.45% to 7,157.58; financials skidded by 7.48 points or 0.46% to 1,612.99; and industrials dipped by 4.30 points or 0.03% to 11,726.07.

In contrast, the mining and oil sector surged by 82 points or 0.77% to 10,685.33; while services gained 6.08 points or 0.39% to 1,532.31.

Tuesday’s major decliners were property giant Ayala Land, Inc. as well as conglomerates JG Summit Holdings, Inc. and GT Capital Holdings, Inc.

“Those three stocks accounted for 23 points of the decline [ yesterday],” Unicapital’s Mr. Azurin said.

Value turnover improved to P6.70 billion yesterday after 4.73 billion shares changed hands, from the P5.31 billion logged on Monday.

Foreign investors returned to selling mode, with net outflow amounting to P706.66 million — a turnaround from the P186.46 million net foreign buying recorded in the preceding session.

Losers edged out advancers, 99 to 86, while 52 names were flat.

“The market is awaiting decisions from the US Fed meeting and some investors are already anticipating results for the first quarter,” Unicapital’s Mr. Azurin said, referring to the US Federal Reserve, which meets to review policy on April 26-27.

Long-term investors are now on a wait-and-see mode as they await the outcome of the elections, he said, citing the low trading volume over the past few days.

“As long as the 7,200 level holds, there is still potential for the market to close up. But it could go down to 7,150 if it fails to sustain it,” added Regina Capital’s Mr. Limlingan.